Last week we saw the latest and greatest from the land of The Euro Crisis. We anticipated what the market would do and it did something else. That is the way it usually works. You can’t predict the future, but you have to try. You make a guess, take a calculated risk and then adapt to the world as it changes on you unexpectedly. Protect yourself.

The best stock analysts don’t get it right that much more than the rest of us. The best get it right around 60% of the time. What they do well is protect themselves when they are wrong. Limit their losses and adapt to the changes, they make good course corrections.

Today the Euro Crisis continues, as it will for some time. So now that we know more than we did before, what will we do differently? What did we learn from the past week and what can we do better in the future? How fast can we adapt when we find that we are wrong?

Tomorrow when the banks open in Cyprus, will there be a run on the banks or an orderly restart to the system? How will the big depositors react to having 40% of their money taken from them? Will they run on the bank? We won’t see them in the street… How will the markets react to the news and how can you best position yourself? How can you best protect yourself?

Right now I am still totally defensive. Missing the rally. That is the cost of playing it safe, missing the opportunities…

This morning when the European stocks started to pull back, I felt like a genius! Here it is, the pull back and I am ready for it! But I have to look back at all the gains I missed to be here. It isn’t about picking the market top at the instant of change. It is all about getting enough of the upside to succeed. I am not going to do that if I remain in cash forever. They all tell you that “the market rewards risk taking”. What they don’t mention is that it penalizes risk too.

So I am still shopping for stocks and options. Hoping for a pullback to buy at a discount, but I am becoming motivated to buy at a premium just to get back in the game…

What if I am wrong about this whole pull back genius thing? I will anticipate, adapt and change course as required…